Cruise Lines Expand All-You-Can-Drink Packages
by  and  rew Sheivachman

For years, cruise fares that cover alcoholic beverages have been a staple of luxury and river cruises. Now the largest cruise lines in the world are answering with their own inclusive pricing.

In 2012, mainstream cruise lines including Carnival, Royal Caribbean and Norwegian experimented with all-you can-drink beverage packages. The trend accelerated last week when Royal Caribbean announced that it will begin selling drinks packages on its 22 ships early in 2013.

The move followed Carnival’s expansion to six ships of a similar program that it has been testing this year. Norwegian Cruise Lines is also testing out the formula.

Not commissionable
Priced between $42 and $55 per guest, per day, depending on the cruise line (see sidebar), the plans are seen as a pitch to attract more price-conscious cruisers.

Royal Caribbean has positioned its drinks packages as one component of a fleet-wide revitalization program that includes enhanced dining and beverage options.

For the most part, drinks packages are not commissionable. One exception is a smaller line, Windstar Cruises, pays 10% commission on an all-you-can drink packages purchased in advance of sailing.

Price-sensitive shoppers
Agents deduced that the new deals are being used to stimulate demand from hesitant potential cruisers.

“Part of the problem is people are not cruising because of the economy,” said Jennifer Binish, an agent at Travelex International in Hoffman Estates, Ill.

When money is tight, consumers feel more comfortable knowing the final price tag in advance.

“Nothing’s worse than going on a cruise and knowing at the end of the day you have a $2,000 bar tab. Then everyone isn’t relaxed – they have to budget,” Binish said.

Inclusive strategy
The moves also suggest that the major cruise lines are emulating the inclusive pricing of luxury lines, but without having to increase rates.

“People have always had that image of cruising as being all-inclusive,” said Michelle Fee, CEO of Cruise Planners in Coral Springs, Fla. “The more these cruise lines can make themselves like the luxury lines, the better.”

“People don’t mind spending the money upfront. What people do mind is feeling nickeled and dimed,” she added.

Competing with land?
Nancy Yoffe, owner of Cruise Planners in Spartanburg, S.C., also sees the mainstream cruise lines attempting to position their product favorably relative to land vacations.

“They’re competing with all-inclusive product, because a lot of agents are pushing all-inclusive vacations to their clients instead of cruises,” said Yoffe.

Yoffe said she is wary of the bigger cruise lines adopting a pricing model similar to the airlines. “I don’t want to see a world where everything costs extra, like the airlines have become,” said Yoffe.

“In the end, I don’t see any advantage to me,” added Yoffe. “All this does is drive travel agents to book other products.”

Drinking up
While more upscale cruise lines like Crystal Cruises have offered drink packages or all-inclusive pricing for some time, the wide scale introduction of drinks packages by mainstream lines is a first.

“It’s not a new trend overall, but it has only been available with a group booking,” noted Binish.

Binish told Travel Market Report that in the past she had negotiated all-inclusive drink packages for groups of 50 or more. But Carnival upped the minimum group size to 100 before the introduction of their new drinks program, according to Binish.

“Cruise companies really make their money on alcohol and gambling, so it’s not advantageous for them to offer drink packages,” said Binish. “If you have any kind of drinker in your group, the cruise line will lose money on you.”

Statistics show Americans upping their alcohol consumption during a down economy.

  0
  0
Comment:
You must be logged in to leave a comment Login | Register
Comments
Rey    12/19/2012 4:44:11 PM
If cruise lines are interested in getting into the all inclusive beverage arena why not pay commissions.  There is no incentive for travel advisors to sell the beverage programs, and that goes the same for shore excursions.   

0
Tip of the Day
How does the specter of terrorism change how we conduct our business? The Answer requires that we understand our obligations, and that we acquire and use the available tooks to help us perform those duties. If you hold yourself out as an expert—a travel professional—you must conduct your business in line with that claim.
 
Paul Ruden
Former Executive Vice President for Legal & Industry Affairs, ASTA
Daily Top List

Five Things to Cross off Your Checklist before You Travel

1. Clean out your wallet or purse

2. Keep an eye out for large crowds

3.  Learn a little about money customs in the locale where you’re planning to travel

4. Keep your travel plans and destinations off of social media

5. Travel light and carry copies of important documents

 

-Smith & Howard Wealth Management

 

Top Stories
NACTA Celebrates Its 30th Anniversary
NACTA Celebrates Its 30th Anniversary

The National Association for Career Travel Agents (NACTA) is turning 30 this year, and president Ann Chamberlin and her team are celebrating by opening new NACTA chapters nationwide and launching a new mobile-friendly site.

Heads Up Travel Agents: The ‘Dreaming Period’ for Summer Travel Starts Now
Heads Up Travel Agents: The ‘Dreaming Period’ for Summer Travel Starts Now

Everyone’s dreaming of summer—so now is the time for travel agents to grab their attention, says a new report from Sojern. 

The Passport Crisis Is Heating Up: What Travel Agents Need to Know
The Passport Crisis Is Heating Up: What Travel Agents Need to Know

If your passport is expiring this year, you better renew it soon, the State Department said last week. About 125 million Americans hold passports today, and 40% of them—almost 50 million in all—will expire in the next three years.

Consumer Publications Highlight Romance Travel in February
Consumer Publications Highlight Romance Travel in February

It's Valentine's Day, and the February issues of some top consumer travel magazines will be highlighting romantic destinations. Here's a rundown of some articles your customers will be reading this month.

ASTA Focuses on Five Key Issues for Annual Legislative Day
ASTA Focuses on Five Key Issues for Annual Legislative Day

March 14 and 15 will be ASTA’s Legislative Day on Capitol Hill, and the association and its travel agency members already are prepared with five agenda items to discuss.

Industry Mourns the Ritz Paris
Industry Mourns the Ritz Paris

Insiders lament the temporary loss of the iconic Ritz Paris, where more than 60 firefighters spent hours battling a devastating blaze that soared through the roof. 

News Briefs
Advertiser's Voice
Travel Market Report Spotlight: Celebrity Cocktails